All State and District
Central Co-operative Banks
Dear Sir,
Providing Clearing and
Settlement services for internet based electronic purse schemes
It has come to our notice
that some companies have launched internet based electronic purse schemes
with the following features:
(i) Any individual who
wishes to be a member of the scheme can register himself by going to
the website and filing up a simple form which contains only his / her
personal details.
(ii) The registered person
will thereafter own an account with the service provider.
(iii) Accounts are funded
by transferring the money from bank accounts or credit card accounts.
(iv) The money is credited
into electronic purse account of the account holder and the actual money
is credited into the current account of the service provider with the
clearing and settlement bank.
(v) The electronic purse
account holder can use the funds in his account either to transfer the
funds to another electronic purse account or transfer to any other account
anywhere (which is done through RTGS/DD) or do on line purchases.
2. The above-mentioned
activities are in the nature of acceptance of deposits, which can be
withdrawn on demand. The act of accepting deposits repayable on demand
is in violation of the provisions of Reserve Bank of India Act, 1934,
governing registration of NBFCs and acceptance of deposits.
3. Reserve Bank has asked
a company providing such services to desist from doing so. However,
banks are advised not to associate themselves with such schemes as described
in the paragraph 1 above.
4. Please acknowledge receipt
to the Regional Office concerned of Reserve Bank of India.
Yours faithfully
(K.Bhattacharya)
General Manager